Reliance Retail, owned by Mukesh Ambani, got its first investor. Silver Lake Partners (SLP), the world’s largest tech investor company, is going to invest Rs 7500 crore in Reliance Retail. It got this investment at a time when the company recently acquired the retail business of Kishore Biyani’s Future Group. The deal would make Reliance Industries (RIL) around one-third of India’s retail business.
Reliance Acquired Future Group Business
Reliance Retail is the country’s largest brick and mortar (physical store) retail business. It has more than 11,806 stores in 7000 cities across the country. It has started in 2006. Reliance Retail acquired the retail and logistics business of Kishore Biyani’s Future Group in late August. The deal was for $ 3.38 billion, including the debt of the Future Group company.
Reliance Retail started an online grocery store in May called Geomart. Now the company sells many other items including electronics, jewelry, apparel and vegetables. The company also acquired a British toy company Hamleys last year. It runs several global brand outlets in India including Burberry, Armani and Jimmy Choo.
Five main things about this Deal
Silver Lake Partners (SLP) will invest Rs 7500 crore in Reliance Retail. In return, it will get a 1.75 percent stake in Reliance Retail.
After this deal, the market value of Reliance Retail will be Rs 4.21 lakh crore, the company announced in the September 9 stock market filing.
Silver Lake has also invested in Reliance’s Jio platforms. The company has so far invested Rs 10,200 crore in Reliance Jio.
With this new investment, the Jio Platform and Reliance Retail’s share in RIL’s market value will exceed Rs 9 lakh crore.
The deal is important because RIL is expanding its retail business in India and is competing with companies like Amazon and Flipkart.